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AP Moller-Maersk shares tumble after 'unsatisfactory' results

Copenhagen-listed group had a difficult start to 2018 and warned of increased uncertainty.

AP Moller-Maersk shares crashed in the wake of a disappointing first quarter report which missed consensus expectations by a significant margin against a backdrop of rising geopolitical risks and trade tensions.

The Danish giant’s stock plunged by one tenth after the results announcement which also revealed rising cost pressures.

Following what it called an unsatisfactory quarter, Maersk stuck by its full-year profit guidance but attached a caveat that it faced increased uncertainty.

Maersk reported a core operating profit of $669m between the start of January and the end of March, some way below the $995m consensus, according to analysts at Clarksons Platou Securities.

“Even adjusting for a $100m negative impact from weak dollar, which could be recurring, the figures are weak, in our view,” said analysts Frode Morkedal and Herman Hildan.

Maersk stock was trading at DKK 9,230 each at the time of writing, a fall of 9.06%.

The figures were the first under a new reporting system to reflect the group’s strategic switch to a container and logistics company and divestment of energy assets.

Soren Skou, chief executive of Maersk Line, said: “In response to the current challenging market conditions we are implementing a number of short-term initiatives to improve profitability and we reiterate our guidance for 2018."

Skou setting up AP Moller as FedEx of box logistics

Maersk is still forecasting an underlying profit above the $356m booked last year. However it warned of “increased uncertainties due to geopolitical risks, trade tensions and other factors impacting freight rates, bunker prices and rate of exchange”.

Hildan and Morkedal said the median core operating profit forecast by analysts for 2018 was $4.6bn.

“If we take the guidance at face value, we would expect no major changes to estimates, although we expect scrutiny of the unit costs development,” they said.

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AP Moller-Maersk shares tumble after 'unsatisfactory' results

Copenhagen-listed group had a difficult start to 2018 and warned of increased uncertainty.

AP Moller-Maersk shares crashed in the wake of a disappointing first quarter report which missed consensus expectations by a significant margin against a backdrop of rising geopolitical risks and trade tensions.

The Danish giant’s stock plunged by one tenth after the results announcement which also revealed rising cost pressures.

Following what it called an unsatisfactory quarter, Maersk stuck by its full-year profit guidance but attached a caveat that it faced increased uncertainty.

Maersk reported a core operating profit of $669m between the start of January and the end of March, some way below the $995m consensus, according to analysts at Clarksons Platou Securities.

“Even adjusting for a $100m negative impact from weak dollar, which could be recurring, the figures are weak, in our view,” said analysts Frode Morkedal and Herman Hildan.

Maersk stock was trading at DKK 9,230 each at the time of writing, a fall of 9.06%.

The figures were the first under a new reporting system to reflect the group’s strategic switch to a container and logistics company and divestment of energy assets.

Soren Skou, chief executive of Maersk Line, said: “In response to the current challenging market conditions we are implementing a number of short-term initiatives to improve profitability and we reiterate our guidance for 2018."

Skou setting up AP Moller as FedEx of box logistics

Maersk is still forecasting an underlying profit above the $356m booked last year. However it warned of “increased uncertainties due to geopolitical risks, trade tensions and other factors impacting freight rates, bunker prices and rate of exchange”.

Hildan and Morkedal said the median core operating profit forecast by analysts for 2018 was $4.6bn.

“If we take the guidance at face value, we would expect no major changes to estimates, although we expect scrutiny of the unit costs development,” they said.